Gold and silver invariably come to mind first when considering precious metals. But for diversification and growth potential, investors should also consider “unsung” metals like platinum, palladium, and rhodium. Read on to learn why and how to add these lesser-known precious metals to your portfolio.
The Investment Appeal of Platinum
Often overlooked next to gold, platinum has qualities that make it an intriguing precious metal for investors. Platinum is extremely rare, even among precious metals, with annual global mine production equating to only about 6.5 million ounces – far lower than silver or gold. Limited supply among growing industrial demand drives price swings and appreciation potential.
Platinum also enjoys diverse real-world applications that support its value. Its chemical and physical properties make platinum essential for catalytic converters, electronics, chemicals, dental uses, jewelry, and more. Platinum prices do not strictly follow gold either, adding portfolio diversification. During certain periods, platinum commands higher market values per ounce compared to gold.
Palladium and Other PGMs
Like platinum, palladium belongs to the platinum group metals (PGMs). Palladium, rhodium, ruthenium, and other PGMs serve vital industrial roles from automotive to tech uses. With mines and reserves concentrated in only a few countries like Russia and South Africa, PGM prices fluctuate with supply disruptions and geopolitical events. Rhodium, for example, soared from $575 per ounce in 2019 to over $21,000 in 2022 amid shortages!
What to Buy and How
For physical platinum ownership, popular products include 1 oz platinum coins and bars from trusted global mints and refineries. Platinum Eagles from the U.S. Mint carry legal tender values alongside containing 1 troy ounce of .9995 pure platinum. PAMP Suisse, Valcambi, and Johnson Matthey are leading platinum bar producers sourcing metal responsibly.
Investors can also purchase shares in platinum ETFs like the Aberdeen Standard Physical Platinum Shares ETF (PPLT) or GraniteShares Platinum Trust (PLTM), which hold physical platinum in secured vaults. Always research any fund’s holdings, costs, and risks before investing.
Avoiding Overpriced Coins
When buying platinum, palladium, or other PGMs for their intrinsic precious metal weight and value, avoid higher premium “collectable” coins graded MS70 or PR70 by third parties. These perfect mint state coins bring exponentially higher premiums that do not correlate to the underlying physical PGM value. Instead, focus on purchasing common lower premium bullion coins and bars to maximize your investment value. It’s also important to note that high-premium, collectable items are less liquid than low-premium, collectable items. Liquidity refers to how quickly you can get your hands on cash!
Finding a Reputable PGM Dealer
Due to their value and rarity, PGMs warrant trusted guidance from experienced dealers who source directly from leading global suppliers like BASF and Anglo American. Here at CV Coins and Collectables, our 52 years in business allow us to offer platinum and palladium alongside gold and silver. If you’re looking for where to buy precious metals in San Diego, stop by our shop or browse our selection online to explore diversifying your portfolio beyond gold and silver bullion.
Research Before Investing
Precious metals investing carries inherent risks like any asset class. Before buying platinum, palladium, rhodium, or other alternative precious metals, spend time researching historical price performance, current supply and demand dynamics, and future outlooks. Read expert analyses about downside risks and upside potential to make informed decisions. Start with small positions for diversification, then increase your holdings over time as knowledge grows. Always work with reputable dealers like CV Coins and Collectables, who can provide expert guidance.
Choosing the Right Investment Strategy
Your individual financial goals should dictate your precious metals investment strategy. Conservative investors may opt for a small 5-10% allocation to PGMs in a diversified portfolio. Speculators may make concentrated bets on rising PGM prices in the short term. Long-term-oriented investors might adopt a strategy of dollar-cost averaging into a mix of precious metals over time. Work with your financial advisors and dealers like CV Coins and Collectables to develop the right strategy for your needs and risk tolerance.